The pound is tumbling after the latest UK inflation data

UK inflation surged once again in January, coming within just 0.2 percentage points of its officially mandated target for the first time in more than two years, but at the same time, missed expectations. The headline consumer price inflation figure was 1.8% against the 1.9% forecast by economists.

As a result of the miss, sterling slipped, falling by 0.5% where it has stayed for most of the day. By 3.35 p.m. GMT (10.35 a.m. ET) the pound is at 1.2463 on the dollar. Here is the chart:

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Tuesday's inflation undershoot, according to Samuel Tombs of Pantheon Macroeconomics "entirely reflected a pull back in clothing inflation to zero, from 1.2% in December."

"December's rate had been boosted by an earlier than usual start to winter discounting by clothing retailers last year, so it always was unlikely to be sustained. We have little doubt that clothing and other retailers who rely on imports will push through big price increases over the coming months."